Ok, first time I've posted a question so please be gentle...
We are in a tough situation. Minnesota residents.
I am the sole income for our family, and make enough that my children receive ma but neither my wife nor I do.
I have some old student loans (3rd party, WF) that have gone to default and now a lawsuit has been filed. $30k plus.
Without making payments to this loan, we are barely keeping our heads above water. We do have some credit cards but they get paid, and we own a home which we are flat even on (not underwater, but no equity) and two cars totalling in value under 7k. Nothing else is in arrears, just these student loans. It is also important to note that this suit is over two loans, with two more sitting in deferrment until the end of the year as I will graduate then.
We see a couple options, none are pretty but we're looking at the overall picture and not just what might be easier right now.
1. Let them get the judgment. We are essentially judgment proof as in MN you can't garnish if you get MA. We also have little in the way of savings so not much to hold there either. This may or may not always be the case, that's the gamble.
2. Chap 13. This puts things off for 5 years and with our income the payments would be low. However if we can't find a suitable way to improve either income or expenses we will be in the same shape in 5 years.
3. They have offered a settlement deal, would shave off 10k but there's no way we could make it work and we'd just get defaulted on that in a year too.
One final thing we need to note is this. At least once a year (sometimes 2x or 3x ) we get one time payments, in some cases into the 3-5k range (tax refunds, student loan overage). These funds help keep us on the level and not losing ground. However, it is my understanding that if the judgment comes down these can be attached regardless of whether they have a judgment or a chapter 13 in place.
Suggestions?
We are in a tough situation. Minnesota residents.
I am the sole income for our family, and make enough that my children receive ma but neither my wife nor I do.
I have some old student loans (3rd party, WF) that have gone to default and now a lawsuit has been filed. $30k plus.
Without making payments to this loan, we are barely keeping our heads above water. We do have some credit cards but they get paid, and we own a home which we are flat even on (not underwater, but no equity) and two cars totalling in value under 7k. Nothing else is in arrears, just these student loans. It is also important to note that this suit is over two loans, with two more sitting in deferrment until the end of the year as I will graduate then.
We see a couple options, none are pretty but we're looking at the overall picture and not just what might be easier right now.
1. Let them get the judgment. We are essentially judgment proof as in MN you can't garnish if you get MA. We also have little in the way of savings so not much to hold there either. This may or may not always be the case, that's the gamble.
2. Chap 13. This puts things off for 5 years and with our income the payments would be low. However if we can't find a suitable way to improve either income or expenses we will be in the same shape in 5 years.
3. They have offered a settlement deal, would shave off 10k but there's no way we could make it work and we'd just get defaulted on that in a year too.
One final thing we need to note is this. At least once a year (sometimes 2x or 3x ) we get one time payments, in some cases into the 3-5k range (tax refunds, student loan overage). These funds help keep us on the level and not losing ground. However, it is my understanding that if the judgment comes down these can be attached regardless of whether they have a judgment or a chapter 13 in place.
Suggestions?
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